Region Focus

Second Quarter 2010

Do Deficits Matter? And If So, How? As fiscal imbalances increase, economists debate their effect on the macroeconomyWhether budget deficits matter is an important political, economic, and policy issue, especially given large projected expenditures for entitlement programs. Economists seem to agree that deficits are not inherently inflationary. But their effects on interest rates and other economic variables are less certain.Related Links